"Taxes too high, wages too high, we’re not going to be able to compete against the world."

That was in the context of a debate about protesters demanding a $15 minimum wage. Asked if he was sympathetic, he said:

“I can’t be…and the reason I can’t be is because we are a country that is being beaten on every front... Taxes too high, wages too high, we’re not going to be able to compete against the world.”

2 days after that, he simply denied saying wages were too high:

“I didn’t say that. Bret, we were talking about the minimum wage, and they said ‘should we increase the minimum wage?’ And I’m saying that if we’re going to compete with other countries we can’t do that because the wages would be too high.... I was referring to the minimum wage..."

It's odd — it's Trumpian — to say straightforwardly what is an outright lie if it's taken straightforwardly: "I didn't say that." Clearly, he did. I understand that he meant that in context the words obviously never meant what they look like outside of their context. I guess we could bat around the linguistic issue of what it means to "say" something. But he gave his opponents the words to use against him, and Hillary did it again today.

His plans will actually tend to raise wages due, bluntly, to the lack of Mexicans. There is thus no need for a $15 minwage as the wage level will be comfortably raised for all except the most marginal labor, which would be unemployable at $15.

As for the "lie" it's not what he said, it's what he meant. Get used to not relying on some notion of hyperclarity and superparsing. None of us live that way. If you don't know what he meant, ask him "What do you mean?"

Ah the joy we have with two "lying weasels"---on offer. Of course Hillary never bothers with just a straightforward lie. She uses all the other colors in the Crayon Box of Lies instead.

Trump may have (at the moment he said it) intended to say that the minimum wage is too high.

But he also could have echoed any number of American business executives who concluded that the cost of unionized labor was too high--and thus moved their automotive assembly plants to the southern (relatively less unionized) part of the USA, or to Mexico. Also any number of American companies have moved their work overseas to get lower labor costs.

Just because something is unpalatable doesn't mean that it's not true.

When they are not busy savaging their opponents, liberal progressive types like to talk about competing in a global economy.

Oh, and despite what anyone says or any governments do, the actual minimum wage is ZERO. That is what the person that was unable to get a job due to the inflated employee costs earns. Thanks to President Three-putt, more and more Americans are able to take advantage of this minimum wage.

"The Clintons have reaped significant financial rewards from their relationship with the Indian community, both in their personal finances and Hillary’s campaign fundraising. Hillary Clinton, who is the co-chair of the Senate India Caucus, has drawn criticism from anti-offshoring groups for her vocal support of Indian business and unwillingness to protect American jobs…"

I don't know about that--in the context of explaining why we're "getting beat" by overseas competition, mentioning that "taxes too high, wages too high" leads to the most likely conclusion that you're referring to prevailing wages, not necessarily the legal minimum wage. After all, most of the factory wages and other wages affected by international competition is at a level well above the legal minimum wage. And even if we eliminated the minimum wage, does anyone think we would see prevailing wages drop to such an extent that we could compete with overseas labor?

Trump made a point that wages are too high--rather than dance around it and try to credit his walkback (saying he only meant the legal minimum wage) why not address what he really means? Prevailing wages are too high to compete with other countries, and the only way we can overcome that is if our work is so much more efficient than foreign labor that it still is cost-effective to use our labor instead. Or, find other cost-cutting (e.g., regulatory costs) to balance it out and make us more competitive.

Rising wages + advances in automation = millions of people around the globe with no job prospects and nothing to do. I think the lack of work, any work, will be a far bigger problem in the future, and will kick us in the ass somehow, way before any environmental calamity.

Really, the problem with the Democrat's raise the minimum wage AND open the floodgates to unskilled immigrants is that there will be massive unemployment. The high minimum wage will dry-up low skill jobs while the immigration will swell the numbers of unskilled workers. But don't worry, the Democrats have a plan: Welfare. Yes. get all these new people hooked on the welfare state and they will vote Democratic for life. What could go wrong?

With Trump, you restrict unskilled labor by keeping low skilled immigrants out, this will drive up wages for unskilled jobs and suck workers out of welfare dependency. This is not in the interests of the welfare plantation.

Brando said...I don't know about that--in the context of explaining why we're "getting beat" by overseas competition, mentioning that "taxes too high, wages too high" leads to the most likely conclusion that you're referring to prevailing wages, not necessarily the legal minimum wage. After all, most of the factory wages and other wages affected by international competition is at a level well above the legal minimum wage. And even if we eliminated the minimum wage, does anyone think we would see prevailing wages drop to such an extent that we could compete with overseas labor?

Trump made a point that wages are too high--rather than dance around it and try to credit his walkback (saying he only meant the legal minimum wage) why not address what he really means? Prevailing wages are too high to compete with other countries, and the only way we can overcome that is if our work is so much more efficient than foreign labor that it still is cost-effective to use our labor instead. Or, find other cost-cutting (e.g., regulatory costs) to balance it out and make us more competitive.

Such a gloriously well-written response. It won't go over well, in Trumpland. Where the answer always seems to be, Trump will threaten businesses like Ford with prohibitive taxes. Trump, the great negotiator, will make Ford close down in Mexico and bring all the plants back to the U.S. He will threaten them, then impose a tax. Well, no, he'd need congress to pass a tax. As if a Trump negotiation could make any of it sensibly work.

For all of his bluster about U.S. auto jobs and Mexico, I've never once heard Trump pick up on the suggestion of WSJ opinion pages, and discuss an end to the Obama Administration CAFE standards. If only Trump could read and understand the Journal editorials; he might be a better candidate. He'd probably have to skip over the editorials criticizing his candidacy.

How is it that CNN "knows" what Trump meant to say when it comes to profiling immigrants that are in this country but not when he talks about wages?

COSTELLO: And it's hard to not notice, Jeff, that Donald Trump again brought up the idea of profiling immigrants. I mean, yesterday he was upset that news people used the term racial profiling but he was on The O'Reilly Factor last night and Donald Trump clearly meant racial profiling when he said profiling.

That is some strange mind-reading they do there. Funny how Trump never gets the benefit of the doubt (or any Repub for that matter) with the MSM but Clinton (or any Dem) always get the benefit of the doubt and then some. Down right funny...

"Such a gloriously well-written response. It won't go over well, in Trumpland. Where the answer always seems to be, Trump will threaten businesses like Ford with prohibitive taxes. Trump, the great negotiator, will make Ford close down in Mexico and bring all the plants back to the U.S. He will threaten them, then impose a tax. Well, no, he'd need congress to pass a tax. As if a Trump negotiation could make any of it sensibly work."

I figure among the smarter Trump supporters, they understand his bluster is just bluster, but figure at least tossing him into the works will prevent the lowering of any further trade barriers that enable further job losses.

The problem is nothing can really fix the problem of uncompetitive wages, when that difference is great enough. Threatening companies (as Obama did, and Trump now suggests doing) isn't going to make a company go against its own interest. Not if there's enough at stake for them.

Whatever happened to context? Minimum wage is for folks who want a second job or anyone trying to pick up a little cash during the summer to help control student debt or augment Social Security for retired seniors. It will be a moot point when customers start self-ordering using robots and/or I-pads.

Ah, the NYT, confidently believing that they'll send the Trump base reeling with that one! Hillary has the answer, and she just wants a chance to order your world for you. Please let her set everything right that has been wrong for the last eight years. She will take from others and give to you!The Times senses that victory is within her grasp.

Well, it's true. In an open-borders, free-trade world, US wages are high. Why do you think companies offshore operations? Why do you think they scramble to replace US workers with foreign workers at home?

Reducing artificial barriers to trade (tax, regulatory) optimizes the overall economic system. This is a well known economic law, but it means that over time high cost areas of production lose out to low cost areas of production and the biggest factor in high costs are labor costs.

Companies can adjust in relatively short time-frames by firing workers and closing facilities to be replaced by new facilities and new workers in another place, but individuals and families cannot, particularly if they are "dug in" with mortgages, families and other local ties.

For Trump, as an employer, "wages" mean total cost to him per employee. 40-50 years ago, the contractor I worked for estimated the "fringe benefits" required by law for hourly employees at 22%. I think it is a safe bet that this percentage is higher now.(Note that for a construction contractor, "office expenses" do not figure into the hourly wage when estimating a project. That is a separate item.)

JWH said... The Verizon CEO, if you believe that he works 40 hours a week, and believes that he works 52 weeks a year, make $12,975.00 per hour.

9/21/16, 8:46 AM

I did not read the links so I am not sure if your comment is related nor if you are pointing this out as a good thing or bad thing. That said, all I can say is good for him. If some business is willing to pay him that much, fantastic. As long as he or the company is not engaged in fraud or theft, is not breaking any laws, compensation is an agreement between the company and the employee and I fault no employee for trying to get as much as they can, what they are worth. Just as I fault no company for trying to pay as little as they can get away with for a specific employee. That is the great thing about a free-market (not that we really have one of those, but I can dream) in that it take both parties to be "happy" with a deal for a deal to be made. If you think your company is paying you too little, ask for more and/or find another job.

That is part of what is so wrong with a minimum wage. It is forcing an employer to pay more for an employee to do a set of tasks than those tasks are worth. As a result either fewer employees are hired or the company must raise prices resulting in them being less competitive. Same as oppressive regulations raise the costs or running a business and affect how many people a business can employ.

It's amazing how many don't realize the cost beyond the actual wage an employer pays to employ someone. The minimum wage is one of the worst things done to the black community - specifically young black males. Why do democrats hate blacks?

"It's odd — it's Trumpian — to say straightforwardly what is an outright lie if it's taken straightforwardly: "I didn't say that." Clearly, he did. I understand that he meant that in context the words obviously never meant what they look like outside of their context. I guess we could bat around the linguistic issue of what it means to "say" something. But he gave his opponents the words to use against him, and Hillary did it again today."

Kind of like SEIU supporting the $15 minimum wage - but not for their employees.

They also vigorously oppose their employees unionizing.

I don't know about that--in the context of explaining why we're "getting beat" by overseas competition, mentioning that "taxes too high, wages too high" leads to the most likely conclusion that you're referring to prevailing wages, not necessarily the legal minimum wage. After all, most of the factory wages and other wages affected by international competition is at a level well above the legal minimum wage. And even if we eliminated the minimum wage, does anyone think we would see prevailing wages drop to such an extent that we could compete with overseas labor?

The only option I can see to compete there is in quality. Other can always work more cheaply, but we'd need union and non-union shops to thoroughly up their work and insure that the products produced here are amazing. The 1970's killed our car industry for years because we produced pure shit here.

We will never compete with Chinese slave labor. But there is no reason why we cannot produce better products.

Trump made a point that wages are too high--rather than dance around it and try to credit his walkback (saying he only meant the legal minimum wage) why not address what he really means? Prevailing wages are too high to compete with other countries, and the only way we can overcome that is if our work is so much more efficient than foreign labor that it still is cost-effective to use our labor instead. Or, find other cost-cutting (e.g., regulatory costs) to balance it out and make us more competitive.

I'm not convinced that efficiency will make up the difference. Really low cost will trump a lot of things.

The issue with the minimum wage isn't the people getting minimum wage. It's the union guys who have salaries tied to the minimum wage (i.e, double minimum wage, etc). A raise in that increases, tremendously, the labor costs in union shops.

The Verizon CEO, if you believe that he works 40 hours a week, and believes that he works 52 weeks a year, make $12,975.00 per hour.

The CEO works dramatically more than 40 hours a week. People don't often realize the ridiculous hours CEO's put into their jobs.

They aren't overpaid (one cannot be "overpaid" in an open labor market). I think their valuation is absurd, but that's another story.

And I hope that gets brought up because, as mentioned earlier, Hillary's hourly compensation is multiples higher with far fewer benefits to the country as a whole. Verizon simply provides a solid cellular network, good internet and cable TV service, good home service, and tens of thousands of jobs.

Hillary gives Sidney Blumenthal a job.

They aren't illegals, of course. They didn't sneak across the Mexican border. They are here on the same sort of visa that Melania Knauss Trump had.

The H1-B visa is a massive problem and needs to be curtailed severely. Not sure how his wife is relevant to the topic since her job was modeling and it's not a field that is largely based on genetics and not any natural aptitude.

"The only option I can see to compete there is in quality. Other can always work more cheaply, but we'd need union and non-union shops to thoroughly up their work and insure that the products produced here are amazing. The 1970's killed our car industry for years because we produced pure shit here."

That's right, and that's why if government is going to do anything about this it should start with figuring out what rules and laws it has in place (at all levels, not just federal) that are preventing us from innovating and becoming more efficient.

Efficiency alone probably cannot completely overcome very low wages--50 cents an hour for labor is just going to be tough to beat--but depending on the skill levels needed and the nature of the industry, greater efficiency can add to some other factors (e.g., skilled labor availability, at least for a time) to make it not economically worth it for the producers to shift overseas.

We have a reckoning with this problem, particularly as it hits more industries and it coincides with the more acute problem affecting labor demand--automation--leaving us at a point where we may simply have far too many people chasing far too few jobs. I don't know if there is any good solution to that, but the recent political offerings (raising the legal minimum wage, "better trade deals" (whatever that means), taxing the top 1% more) may sound good to people worried about their jobs but aren't going to do squat.

Maybe in four years we'll have a candidate willing to get at this problem. Isn't happening now though.

I was at the manufacturing show last week and had an interesting conversation with a woman who works for a large machine tool company in WI. They've been building machine tools for 100 years. She was telling me that they have a problem finding employees. Skilled employees in particular but unskilled employees as well.

One of their big problems is finding people who can pass the drug test. She told me it was 20%. I first said, 1 out of 5? Wow, tha't high. She told me, no, 4 out of 5 fail.

She had worked previously for Mercury Marine in Fon du Lac and told me they had the same problem. The majority of applicants could not pass the drug test.

the week before I was in Ohio in a manufacturing plant. Seemed like a pleasant enough place to work. They pay $12-14 per hour, entry level, unskilled, and can't find people.

In June I was passing through WI and we stopped at a McD's near Menomenee. Per signs on the doors, they were looking for team members. Starting, no experience, $10/hour (18 years old) Anyone know what McD pays in Madison?

A recruiting company called me in July from NJ. Don't know why but they had gotten my name and asked me if I could help them hire Pharma Plant manufacturing operators in NJ. No experience required. They were going nuts trying to find applicants.

Last year I had dinner with a client who is engineering Mgr in a NYC pharma company. They were trying to hire mechanics. They did an ad blitz and got 250 applications. 6 or so were interesting enough to interview. None of those interesting enough to make an offer to.

A company near Chicago pays mechanics $60-80m/yr plus great benefits. They've had openings for 5-6 mechanics as long as I've known them. The owner would love to expand, he has more business than he can handle, but can't find people.

I go all over the US and talk to lots of people in lots of industries. All have trouble finding applicants.

I don't think it really matters what the minimum wage is or what typical wages are. Employers are going to have trouble finding employees. the problem is much deeper than wage rates.

For Trump, as an employer, "wages" mean total cost to him per employee. 40-50 years ago, the contractor I worked for estimated the "fringe benefits" required by law for hourly employees at 22%. I think it is a safe bet that this percentage is higher now.

Absolutely, Hagar. the relevant cost is not the wage rate but the cost of having the employee on the payroll. That is true for the lowest hourly worker all the way to the CEO.

When I studied compensation management in grad school in the 70's, the rule of thumb was that the cost was wage rate plus 50%. Most of my clients, when figuring labor costs, double the wage rate for a rough approximation. Thus a person earning $12/hour costs the employer about $24.

I understand that he meant that in context the words obviously never meant what they look like outside of their context. I guess we could bat around the linguistic issue of what it means to "say" something. But he gave his opponents the words to use against him, and Hillary did it again today.

This is legalistic bullshit. David Foster Wallace would not approve.

Words don't have meaning outside of their collective context.

Repeatedly taking the words out of their understood context is dishonest and more importantly, it's exactly the "ham-handed" sort of foolishness that the media and Clinton seem to think is going to stick against Trump but it never does.

It's ham-handed and foolish because everyone knows it's bullshit. Trump and his supporters understand what Trump meant. Clinton and her supporters understand what he meant, but think somehow they're smart enough to feign ignorance while at the same time trying to convince low-information undecided voters that he said something else.

But low-information voters, if they think about it, don't talk or think in lawyerly Newspeak, and don't like being condescended to. So I don't see how this is ever a good strategy.

So Trump first says last November that minimum wages are too high to allow us to compete in the world economy and then in May comes: "I have seen what's going on, and I don't know how people make it on $7.25," said Trump on NBC's "Meet the Press," referencing the federal minimum hourly wage. "With that being said, I would like to see an increase of some magnitude, but I'd rather leave it to the states. Let the states decide."

Speaking on ABC's "This Week With George Stephanopoulos," the business mogul said, "I haven't decided in terms of numbers, but I think people have to get more."

So you Trumpians out there can pick and choose the position that you like best, but what it all means is that, thankfully, nothing will be done with the most faulty artificial economic rule ever imposed by liberals, which BTW, Trump accepts as an important law - when, in fact, minimum wage increases always reduce employment. Also, please notice that he, The Donald, hasn't decided on a number. That sounds like he continues to think in terms of presidential dictatorial powers.

I do think that a lot of CEOs of big companies are overpaid for what they contribute. It has more to do with board (of directors) capture than anything, and that some of CEO hiring is defensive - the board isn't going to pay as high a price if they hire a big name than if they don't, and he fails. What we used to call the IBM effect on EDP purchases. But that effect doesn't usually move down further than, say, the level of executive VPs. And, in the scheme of things, their compensation typically is de minimus as an expense. Still, the right CEO can have a far bigger effect on a company than the hiring of a number of right lower tier employees - except that the right CEO will often result in the hiring of more good lower level employees.

If it is not out of school, why do you need people who can read a vernier or (non-digital?) micrometer?

I can read one but I do it so infrequently, maybe every couple of years, it feels more like a parlor trick than a useful skill. I also need to think quite a bit about how I do it.

Why not use electronic mikes or calipers? Cost is reasonable, I bought a new one on Amazon for $19 recently with 3-1/2 digits. A good Mitutoyo or the like of similar size is only $150 or so. An electronic mike can send the reading wirelessly to data collection software eliminating the need to write it down or enter manually.

Also much harder to make an error with a digital, as opposed to an analog, reading.

I can think of 1-2 apps where vernier is useful but not generally. That is why I am curious about yours.

Also: When I bought the caliper, Amazon recommended a $15 borescope. The last borescope I bought was in the 70s and cost $20m. This is a webcam, a ring LED and 15' of USB cable. The camera/light is about 1/4" OD. Does still or video at pretty good resolution. Plugs into my phone or tablet. I bought it mainly out of curiosity. I didn't expect much but it is pretty cool. I am recommending to clients that they buy one for every technician for their toolboxes.

The 22% in "fringe benefits" I mentioned above, is for union construction labor hired by the day. For "company employees," the "double the salary" rough rule of thumb in order to break even is still good.

Chuck said"Trump, the great negotiator, will make Ford close down in Mexico and bring all the plants back to the U.S. He will threaten them, then impose a tax. Well, no, he'd need congress to pass a tax."

Stroke of the pen, Mexico loses Most Favored Nation status. Import tariff goes from 6% to 40%. You can thank Bill Clinton for usurping Congressional authority in 1993 with EO 12850 with China. If it works for Iran Nuke deal, Iran ransom, why not ratfuck Ford and Mexico?

Wages - all wages - are too high, and so are costs. It is official state policy that costs should relentlessly escalate. That should be questioned, as should the monstrous ZIRP and NIRP policies which supposedly promote cost escalation at the divined correct rate of 2% and have utterly failed to do so, and which also steal money from savers to benefit debtors, many of which, together with their creditors, are foolish.

The minimum wage was invented by "progressives" to disemploy undesirables (their word) so they would give up and not reproduce. It worked. It still works. The real minimum wage is zero. This government wage prohibition on voluntary labor interaction is evil.

"Taxes too high, wages too high, we’re not going to be able to compete against the world."

How is it that this statement needs clarification? There are three parts, the first two reference the third. A+B=C. Further, was this statement not in answer to a question about minimum wage? And this is called an outright lie? Bull-oney. Trump's focuses on the big picture and the economic harm engendered by artificial wage increases paid for by voracious taxation. Supporters of minimum wage increases focus myopically on the imagined individual benefit of a salary increase, admitting no causation related to employers profit loss, or employees decrease in hours, or job loss.